ULI Austin Launches Web-Based Affordable Housing Calculator Developed in Coorperation with HousingWorks Austin
January 25, 2023
AUSTIN, Texas – January 25, 2023 – ULI Austin, an education, research and resource organization focused on shaping the future of the built environment for transformative impact in communities worldwide, and HousingWorks Austin, a nonprofit organization that aims to increase the supply of affordable housing in Austin, today announced the launch of a new web-based Affordability Calculator designed to help policymakers and other affordable housing stakeholders understand the financial viability of proposed affordable housing developments.
This educational tool, developed by Aodhan Hemeon-McMahon, allows users to input specific development assumptions and an Austin zip code to see if a development would be considered financially feasible for an investor. The Affordability Calculator does this by comparing the return generated from the user’s inputs to an internal rate of return (IRR) “hurdle”. Users can then add subsidy assumptions and/or apply a property tax abatement to push the returns over the hurdle, if necessary.
To view the Affordability Calculator, visit https://housingworksaustin.org/education/affordability-calculator/.
It is important to note that the Affordability Calculator is to be used for educational purposes only and is designed to allow users to compare the relative merits of one possible development over another. It should not be used as verification for a specific development’s worth or potential financial return.
“We hope that the Affordability Calculator can serve as an educational tool for housing advocates and the community to better understand the economics associated with developing affordable housing for households with low- and moderate-incomes,” said Nora Linares-Moeller, Executive Director of HousingWorks Austin. “We are excited to continue working with other housing supporters, like ULI, to identify creative policy solutions to increase the supply of affordable housing throughout the Austin region.”
The Affordability Calculator requires only three steps to operate:
- Step 1 – Click the link to begin download of the Affordability Calculator Excel workbook. Once downloaded, open the Excel workbook and click to Enable Content.
- Step 2 – Change any of the yellow cells to understand whether the project is financially feasible, such as:
- The ZIP code that your hypothetical development would be located within (the cell will only accept valid Austin ZIP codes);
- Development specifications, such as number of units, the bedroom mix in the units, the IRR (internal rate of return) hurdle;
- And any further funding through property tax abatement or subsidies available to the development
- Step 3 – If desired, change other development assumptions on the right side of the spreadsheet, which are automatically populated with base assumptions using current real estate averages, but can be adjusted depending on the specifics you want to project in your hypothetical development.
“We are very appreciative of the time and effort put into this affordable housing calculator by Aodhan Hemeon-McMahon and Housing Works Austin,” said Paulette Gibbins, Executive Director of ULI Austin. “There is a great need for additional affordable housing development in Austin and across Central Texas, and it is hoped that this affordability calculator will be a helpful resource to those determining the financial viability of future projects.”
About ULI Austin:
The Urban Land Institute (ULI) is a member-led organization shaping the future of the built environment for transformative impact in communities worldwide. ULI is a network of people in every profession and sector in real estate development and land use from all over the world and in every career stage. While global in scope, ULI is local in impact through sharing knowledge and making connections. The Austin District Council was founded in 1994 and now includes over 1100 members. Our members are involved in all aspects of the development and city planning process – private, public, and nonprofit. For more information, visit Austin.ULI.org.
About HousingWorks Austin:
HousingWorks Austin is an affordable housing advocacy organization that aims to increase the supply of affordable housing in Austin by providing research, education, advocacy and thoughtful, workable affordable housing policy recommendations. A by-product of the unprecedented growth that Central Texas is experiencing is a sharp decline in affordability, in part due to rising home values, increasing rents and growing transportation expenses. By working with stakeholders throughout Central Texas, HousingWorks Austin encourages dialogue and raises awareness of the cooperative effort required to make housing affordable for anyone, anywhere in the city. For more information, visit HousingWorksAustin.org.